Jewelry Wholesaler Pleads Guilty to Running Ponzi Scheme

On Dec. 30,  jewelry wholesaler Gregory Altieri, 53, pled guilty in New York federal court to wire fraud, for running what the government calls a two-year $200 million Ponzi scheme.

Altieri also admitted to securities fraud as part of the plea. A Securities and Exchange Commission complaint said that Altieri worked as a salesperson in the jewelry industry for more than 20 years before starting LNA Associates in 2006. Altieri was listed as the Melville, N.Y.–based company’s CEO.

According to a government press release, beginning in August 2017, Altieri solicited between $75 million and $85 million in funds from over 80 investors for LNA.

A July 2020 indictment alleged that Altieri claimed that he promised the investors, including retired firefighters and police officers, that he would buy jewelry at “closeout” prices and then resell it at a high profit. The investors were sometimes promised 50%–70% returns within 90 days, it said.

However, while Altieri initially purchased some jewelry with investors’ money, by May of 2018, he was using most of his funds to pay his initial investors, according to the complaint—which further alleged that Altieri misappropriated at least $3.8 million in investor funds.

According to the SEC, while the scheme was going on “Altieri assured investors that the business was legitimate, that the business was running smoothly, that the jewelry had been purchased and sold, that the investors would be paid in full, and that the delays in payment were being caused by the jewelry brokers and dealers to whom Altieri had sold the jewelry. None of these statements was true.”

By January 2020, Altieri stopped making payments to investors, the SEC said. LNA was forced into bankruptcy in April 2020.

Neither Altieri nor his attorney could be reached for comment at press time. But attorney Edward V. Sapone told the Staten Island Advance: “Our system recognizes remorse and rehabilitation. From the moment Mr. Altieri hired me, his goal was to accept full responsibility and to try to help make the victims as close to whole as possible. At sentencing, I will lay out his extraordinary steps in that regard.”

(Image credit: Getty)

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